> > Check. China's 'peasants' and 'peasant-workers' (still about 70% of
> > the population) are on the whole pretty destitute.
>
> Relative immiseration isn't the same thing as absolute immiseration.
> China's biz elites and developmental state are investing that surplus like
> mad -- investment ratios are past 40% of GDP.
Who mentioned anything about absolute immersation? You said destitute. Although it is true that the absolute number of people living in China (according to the government's own poverty line) is increasing.
> > Independent industrial base? Can you give examples?
>
> Haier? TCL? SMIC? Lenovo? One third of the world's electronic parts? State
> of the art MPU tech (http://www.theregister.co.uk/2005/07/25/china_cpu/)?
Haier, TCL and Lenovo are all small. And they're all new competitors in mature industries with cutthroat margins. SMIC is primarily the extension of Taiwanese capital into China, the CEO is American, and where do they get their capital goods from? Godson is a couple generations behind state-of-the-art, although impressive nonetheless.
China has made great strides in lots of fields, but unfortunately the rate of advance among the foreign firms they now have to compete with has been quicker. This is Peter Nolan's thesis, and it's based on lots of careful empirical work among industries in China.
> > Don't see a lot of investment into R&D.
>
> It's not a question of official national laboratories, much of it is
> backdoor investment, by local or municipal enterprises who spin off
> start-up high-tech firms in Zhongguancun and elsewhere. The case histories
> of Lenovo and other high-tech firms make fascinating reading on this point
> -- the boom wouldn't have happened without the helping hand of state
> agencies, scientific-technical personnel, etc. bequeathed by the Maoist
> era.
Yes, China used to have a developmental state, I'll grant you that.
> > The best book on the subject (Riskin and
> > Khan) convincingly showed that redistribution in China after the
> > 'Reforms' increased inequality.
>
> Absolute inequality has risen, sure, as the urban coast has taken off
> while the interior has stagnated, but Chinese urban wages aren't falling
> like a stone.
Well, since China is predominantly rural, if you only look at the cities, the best you can come up with is a half-truth. And it depends on what 'urban wages' you're talking about. Real wages for workers in export sweatshops fell throughout the 90s, up to about 2 years ago. Farm income has been stagnant since the late 90s, although it also went up about 2 years ago (falling again now). None of the other East Asian developmental states had such a large 'hinterland' to deal with. Perhaps Japan is an exception, but imperialism seems not available as an option for China to deal with its massive reserve army of labor.
> > China's biggest banks are no longer solely state-owned. You must have
> > seen the news about the sales of large chunks to foreign investors.
>
> But not even close to a majority of the voting rights of those firms.
Who's claiming that? The effect of listing, foreign participation in the management of Chinese banks, and liberalization of the banking sector to foreign banks will have an effect on how China's state-controlled banks operate.
> The
> yuan remains under the tight control of the state authorities, who know
> full well that their forex reserves are a Mitsubishi-Tokyo-Bank-sized
> pulse weapon aimed straight at the heart of the US oiligarchy.
Well, the exchange rate remains tightly controlled, but that's loosening, and soon foreign banks will be able to make yuan loans, futures deals; foreign insurance firms will be allowed in soon, etc. China's has been unable to prevent tens of billion of dollars in hot money from flowing into China to speculate on the yuan (often going into real estate in places like Shanghai). And last, who actually has claims on China's forex reserves? Entities pretty much outside the control of the state. And I see no reason why the Chinese authorities would want to do anything to rock the boat. To give up the final demand generated in the US and other countries would immediately lead to a savage devaluation of the incredible amount of capital investments that have been undertaken in China. What possible interest is in it for China's leadership?
Cheers,
Jonathan